Sunday, July 10, 2011

Late to the game

Reckless Endangerment of the Truth: If we want to minimize the chance of another financial crisis, it’s important for us to understand how it happened. If we get the causes wrong, our attempts to fix the problems in the financial sector are unlikely to be successful.

That’s why I was so disappointed to see the new book by Gretchen Morgenson and Josh Rosner, Reckless Endangerment, blaming the financial crisis on Fannie, Freddie, and Democrats. The book has been highlighted recently by George Will and David Brooks, and it joins a chorus of conservative voices promoting the idea that government policies to encourage home ownership among middle and low income households is at the heart of the financial crisis.

The dispute over the cause of the financial crisis breaks down along standard ideological lines. ...